After a stock or other security order is placed by a trader at a brokerage's front office, there are several further post-order processing steps involved in the transactions, such as confirmation, payment, settlement and accounting. As part of the clearance and settlement process, trades may be reported to a reporting authority or central counterparty, such as Canada's Clearing and Depository Services, Inc. (CDS) or the United State's Depository Trust and Clearing Corporation (DTCC), which matches the trades with opposing trades and reports matches and mismatches to the brokerage. These steps may be handled internally by the brokerage or by outside custodian or clearance firms.
In order to efficiently process large volumes of trades, brokerages may use aggregation of trade data to minimize the number of trade records or fills to be processed which in the industry is called trade compression. In trade data compression, similar trade records are combined into a single trade record aggregating multiple transactions into a single transaction record.